We all have days when nothing goes right. It starts when you wake up thirty minutes late because you forgot to set the alarm clock. It goes downhill from there – you get caught in traffic, show up to work late, the boss yells at you and all the customers you talk to are surly. On the way home, you get a flat tire and miss your child’s soccer game, which the team loses.  Completely stressed out, you go to bed with a headache hoping for a better day tomorrow.

There is a way to make your day go more smoothly, even if it starts out poorly.  So much of what happens to you depends on your attitude and your reaction to events in the day.  You have more control over how stressed out you get than commonly assumed.  Like a snowball rolling downhill that gains speed as it goes, your attitude and reactions carry a momentum of their own, ensuring that future events of the day will reflect those attitudes and reactions.

In the support center, it is vitally important that we choose a positive attitude and an open-minded reaction to the day’s events. These basic approaches are what good customer service skills are built on. It is the only approach that will ensure that a day that starts poorly doesn’t get worse. In this article, we will explore some techniques that can help us serve our customers better and make our day go more smoothly, even if some bad things happen.

Monitor your thoughts/feelings

Scientists know that human beings are open-loop organisms, meaning that we are sensitive to the moods and emotions of others around us.  We are taught at an early age to align our emotions with those around us.  A mother can soothe a crying baby by holding,  rocking and talking softly to the child.  Because the baby’s emotional system is open and receptive to others, it is comforted by its mother’s calming influence.  We see this as adults when the support manager walks into the office in the morning looking like a thundercloud – perhaps she is looking at the floor instead at the team, she walks quickly to her office without saying good morning, she is frowning.  These clues are picked up immediately and the team is soon whispering, “Look out – the boss is in a bad mood today!  Watch out for your back.” The team acts cautiously and suspiciously all day, avoiding the manager.  People around us pick up on our emotional cues without being told, and they react to us accordingly.  That’s what makes a bad day worse.

Knowing that our emotions affect the way others react to us, we need to monitor our thoughts and feelings so we can change them if we can.  The other day, I was going to a luncheon engagement at a restaurant that offered both valet and self-parking.  I wanted to self-park, but had to wait in the valet parking line to get to the parking lot.  I was late and grumpy.  The valet attendant asked me nicely if I wanted him to park my car, and I must have given him a look that could kill and shook my head to say no.  He responded, “Smile, lady – it’s a beautiful day!” I admit that I wanted to slap him and defend my right to be in a bad mood. But upon further reflection, I realized that the attendant was right, I was upset over something as trivial as being late and stuck in a line. I wasn’t monitoring my own emotions.  I smiled, thought of happy times and was able to have a lovely lunch with no emotional backwash from the incident.

We need to stop the cycle of a bad mood creating bad consequences by consciously changing our attitude.  We can only do this by being aware of how we are feeling and what we are thinking so we can recognize the bad mood before it seizes control of us.

Word of caution: There are times in everyone’s life when really bad things happen to us, such as the death of a loved one, loss of a job, serious illness, etc.  I never advocate trying to “stay on the sunny side” when truly sad and momentous things happen.  It is important to allow yourself to deeply feel whatever negative emotion the situation brings, whether it is anger, grief or great sadness.  What I’m talking about are the small irritations in life that are not big unless we allow them to be.

Remember your happy place

The best way to put the irritations of life into perspective and to lessen my stress level is to remember my happy place.  Your happy place is the mental picture of a time that brought you great peace and joy.  My happy place is the memory of an outdoor summer concert at which both my children fell asleep on my shoulders as we were lying on a blanket, watching the stars and listening to music. All I have to do is remember that time, and I am completely at peace. Your happy place could be a vacation spot you visited, a beach, a woods, a time with your family or loved ones – anything that makes you smile. In fact, it could be an imagined place.

Once you realize that you are getting stressed or upset, remember your happy place and smile.  The physical act of smiling is very important, as it gets the body in synch with the mind’s recollection.  By remembering your happy place, you cut the cycle outlined above of your bad mood attracting bad reactions from others and bad consequences.

Dr. Herbert Benson, in his book, The Wellness Book[1], talks about meditating to reduce stress.  He introduces the concept of a “mini” relaxation moment that is similar in concept to finding your happy space, but suggests breathing slowly ten times instead.

Wish your customer well

Remember we said that your mood affects how others react to you?  Well, that happens on the phone with customers.  The worst thing we can do as support analysts is to pick up the phone when we are upset.  I always suggest taking a walk around the building after handling an angry or difficult customer, to cut the cycle of bad emotions.

Here’s a way to start out on the right foot with all your customers before you answer the phone: When you hear the phone ring, silently wish the customer well or bless the customer. Mentally say, “I wish you well.” This is best done in a calm manner while taking a deep breath to clear your head. In this way, you create within yourself an attitude of helpfulness toward the customer that will ensure that your call goes well, or at least better than if you answered the call while angry.  Try this technique for a day, and let me know if your customers aren’t sweeter than they were yesterday.

Have a great day

Remember that your attitude affects how others react to you, and how the events of the day unfold.  If you monitor your emotions, remember your happy place and wish your customers well, you are on your way to a less stressful day in the support center!

As service providers, we sometimes find ourselves in the position of being the bearers of bad news to our customers.  Often, news is bad only if the customer perceives that he or she has no control over it.  Sometimes, what you consider neutral news may surprise you and be bad news for a customer, again because of a perception of no or little control on the customer’s part.  And let’s face it, there may be times that the way you phrase your communication turns the message into bad news for the customer.  It’s important to understand what bad news is from a customer’s perspective, and what we can do to influence the perception of what is bad news vs. what is good news.

Let’s start by anticipating what might be perceived as bad news from a customer’s perspective.  Then, we are able to rehearse our communication skills to prevent a problem situation.  Here are some instances of having to deliver bad news:

• The customer has experienced a known error in the software, and it won’t be fixed until the next update of the software package – due out next year.
• The customer has experienced a known error in the software or your configuration of it and because there is a work-around available, the programmers have no plans to fix it.
• The customer’s shipment is delayed.  Again.
• The feature that the customer is seeking is not available in the software.

Fortunately, there are ways to communicate news in a way that a customer can see it as good news, or at least see that they have choices.  Generally, honesty is the best policy, but you must think through how you are going to present the honest truth that will make it easier to swallow.

Here are some guidelines for communicating information with your customer:

Bad news early is good news.

The sooner you can communicate what might be bad news to a customer, the more control the customer has over the outcome.  Therefore, procrastination is not advisable in delivering bad news.  For example, if you tell a customer in November that a certain tax feature is not going to be in the software, they can make plans in time to work around the problem and still submit their tax return on April 15.

Confirm your understanding of the problem and identify the underlying need

If a customer is asking for something that you think is going to be a problem, the last thing you want to do is jump in with an explanation without confirming their issue.  “Before I address your concern, let me make sure I understand exactly what you are saying, Mrs. Jones.  I’m hearing that the software doesn’t print the report correctly when you do this… Is that correct?”

Ask probing questions to get to the heart of the customer’s need.  Be sure you understand any deadlines involved, who might be pressuring them about this situation, or if they perceive a threat due to the issue.

Choose neutral words

There are certain trigger words that are almost certain to anger a customer.  Trigger words are those phrases that turn calm customers into raving maniacs.  And having an angry, fightin’ customer on your hands is no fun for you, besides reflecting poorly on your company.

Here is a list of trigger words, with their preferred alternatives:

In fact, any declarative sentence starting with “You” when talking to a customer is best avoided – it comes across as shaking your finger at the customer, and no one wants to feel like we’re talking to our mother!  Better choices are “We can” or “Let’s do this together” or “What I could suggest is”.

Additionally, the calmer you can deliver the news, the calmer it will be received.  Use your most confident but soothing tone of voice, and deliver the news in a moderated pace – that is, don’t speak too fast in order to get the news out quickly!  The customer will sense your assurance and will react positively to it.

Provide background

Give the history of the request, and briefly explain the process that you use to make decisions on this type of issue.  You could say something like, “Our programmers have a very tight schedule and so we must prioritize the changes that they make.  The Change Advisory Board, which is composed of members of both IT and the business units, meets weekly to prioritize Request for Changes.  If the Change Request affects only a few users and there is a reasonable work-around available, it’s likely that the request will be deferred to another time.”

Explain first what you can do and then explain the policy

It is never advisable to start with what you cannot do for a customer.  This puts the customer on the defensive and creates an antagonist environment.  Instead, tell the customer first what you can do for them and offer options.  For example, “I’d like to walk you through the process of logging your request for change over our internet site. Alternatively, you can speak to your business representative yourself.”  Or, “What I can do for you is either create a parts order for you right now on the phone or send you to the website where you can purchase that part yourself.”

Follow up immediately with an explanation of the policy you are invoking, but explain it in a way that shows the customer the WIIFM – What’s In It For Me – principal.  All policies were made at one point with some logic in mind, so seek out that information first.  Then find a way to explain the policy with the customer’s best interest in mind.  Using the phrase “That’s our policy” is never advisable.

Here are some alternative phrases to “That’s our policy” that use the WIIFM principal:

“In order to be fair to all our customers and provide consistent service, we need to prorate your original fee after the 90 day window is passed.”

OR

“In order to help you comply with Sarbanes-Oxley act, we …”

OR

“So we can continue to provide you with the lowest cost products with the highest quality, we need to…”

OR

“Because we always want to provide the highest quality service to you, we can do this…”

If applicable, offer resources or work-arounds and present them in a positive light

If you know of a work-around, offer to explain that to the customer in a positive manner.  For example, “The good news is that we have identified a work around for those few customers that might experience this problem.  Can I walk you through that?”

You may offer to be the customer’s advocate back to the company on their issue.  For example, “Would you like me to record your thoughts on this issue?  Periodically, we compile those requests and present them to the Change Advisory Board.  Additionally, you can approach your Advisory Board representative, who is __________.”  Obviously, you will look up their business unit representative and give them that person’s contact information.

Wait for a response, using your best listening skills

This is a good time to employ your best active listening skills by focusing on what the customer is saying, taking notes, and paraphrasing their concerns to confirm your understanding of what they are saying.

Correct any misunderstandings

If there have been any misunderstandings, correct them, using the neutral words you learned above.  Remember to phrase them in the most positive light.

If the customer gets angry, you’ll need to employ your LEAF Plus One skills (see our article on “How to Handle an Angry Customer”).

Make a follow-up plan, if needed

Take care of yourself

Delivering bad news can be stressful.  Take time to care for yourself if needed.  Take a break and walk around the building.  Take several deep breaths and stretch.  Congratulate yourself for handling a tricky situation like the true professional you are!

To most effectively employ these techniques, you and your team might like to anticipate instances in which you have to deliver bad news to your customers.  Assign a small group of analysts to list possible sticky situations, brainstorm their best responses to them using the guidelines, above, and document their results.  Ask them to create scenarios, skits or role-plays to present to the entire team.  Make practicing these situations a fun game for the group.  The more you can practice these techniques before you need them, the easier it will be to invoke them when the heat is on!

It was 9:15 on a Friday night when I got a tearful call from our former babysitter, who is now a college student.  Lacey’s job this year is to care for young boys who attend an after school program at a near-by Karate school.  Lacey was in tears over an incident in which two young boys, a purple belt and a black belt, got into a vicious fight at the school.  The boys, who are trained to only use their karate skills in class, drew blood and ripped clothing in their altercation.  She disciplined them by taking away their Karate belts for a week – stripping them of their rank, so to speak.  This was a policy that she and her boss, the Karate school’s owner, had agreed on at the beginning of the year.  The next day, the mother of one of the disciplined boys stormed into the school and loudly confronted Lacey about her irresponsibility and lack of control over the boys.  “How dare you take away my son’s black belt!” she roared, shaking her finger in Lacey’s face.  Then the mother complained to Lacey’s boss about Lacey’s behavior.

Later, in a meeting to discuss the incident, Lacey’s boss told her she was wrong to take away the boys’ belts, even though he acknowledged giving her that authority, and said she should have been “nicer” to the mother.  Lacey resigned on the spot.

We’ve all been told, “The customer is always right.”   I appreciate the intent of this phrase – the customer always deserves respect, courtesy and your best professionalism.  However, I disagree with the literal interpretation of this guideline.  In this story, the customer was not right.  Her son needed to experience the natural consequences of his behavior, and just because a mother complains is no reason for a school to get wishy-washy about discipline policies.  The karate school’s owner could have handled the incident differently, perhaps in deferring a conversation with the mother until he could speak with Lacey, or by politely explaining the school’s discipline policy and why it is a good one for not only her son but for the safety of all the students.  Everyone lost in this game – the boss lost a good employee, the mother lost an opportunity to teach her son about responsibility, and Lacey lost what could have been a good job.

As managers and practitioners in customer support centers, we deal with similar situations often.  What are the lessons we can learn from this incident, and how do we apply them to our business?

First, policies must be defined and communicated to your customers and your employees.  In a support center, policies are usually encoded in a Service Level Agreement.  Do you have a Service Level Agreement?  If not, creating one must be your first step.  How to create a Service Level Agreement is outside the scope of this article, but there are many resources on the internet to help you.  Do your customers know and understand the policies that are covered in your SLA?  What good is an SLA if your customers aren’t aware of it?  If you don’t have an ongoing marketing plan for your SLA, you must create one and get the word out to your customers.  Remember, if you don’t set service expectations and limitations through your SLA, your customers will expect you to provide everything – immediately!

Secondly, assume the innocence of your employees until they are proven otherwise.  This is the basic tenant of our USA legal code (the defendant is innocent until proven guilty), and a best practice in business management.  If you get a complaint about one of your representatives, I suggest you follow these steps to rectify the situation:

1. Acknowledge the customer’s emotion, but don’t convict the employee.  Assure the customer that you’ll look into the matter and correct any mistakes.  You might say, “I’m sorry you’re feeling so strongly/angry about the situation, but I need to investigate the situation further before drawing any conclusions.”
2. Investigate the situation by talking to the employee.  See it from his/her side.  If you have a recording of the interaction, listen to it and draw your own conclusions.
3. Ask yourself these questions:  Was the employee following a policy that we have set?  If yes, was the employee enforcing the policy correctly or incorrectly?  Is this a training opportunity for the whole group? Or does the policy need to be revisited?
4. If you believe your representative could have handled the situation differently or you’re not sure what really happened, set up a coaching session with your employee to discuss and role-play a similar scenario.  I’d employ the “3 Strikes” policy – until you have three instances of poor performance, you need to give the employee the benefit of the doubt about their handling of the situation. Put that employee on a more frequent schedule of quality monitoring until you are assured of his/her ability to handle difficult customers.  Of course, if this is a recurring problem with that representative, you must invoke your company’s progressive disciplinary program.
5. Without blaming the employee, get back to the customer and resolve the issue.  You could say, “It appears that we handled the situation incorrectly, but I will do the following to fix it…”  Note the use of “we” and “I”.  By saying, “We handled the situation incorrectly”, you acknowledge that any interaction with the customer is a reflection of the entire company.  By using “I” during the resolution, you assure the customer that a real live person will be responsible for solving the problem.

Two wrongs do not make a right.  Follow these guidelines to ensure that when the customer is wrong, you do the right thing!

On a recent business trip, I received a voice mail message on my hotel room’s telephone from the hotel general manager’s assistant.  The woman welcomed me to the hotel using both my name and room number, and asked me to report any unsatisfactory experiences directly to her. She wanted the opportunity to address my issues during my stay so I would rate them favorably on a customer satisfaction survey that I could expect to receive next week. Because I had just spent over an hour talking to technical support in an unsuccessful attempt to connect to the hotel’s wireless internet service, I called her back immediately and left a message describing my frustration. The next day, I went to the front desk and told them that I wanted my money back on the daily internet service charge because I was unsuccessful in connecting to the internet via the wireless network, and the front desk clerk assured me that she would leave me a message about refunding the charges. Neither the general manager’s office nor the front desk clerk ever called me back.

Ironically, I was teaching two customer service skills classes at this hotel, so you can imagine the stories that I was telling to my classes! I suggested that the class encourage the hotel management to engage me to teach the same class to the hotel staff.

This experience made me think about what customers expect from a service provider.  According to Dr. Leonard L. Berry of Texas A&M University, customers expect five basic things: reliability, responsiveness, empathy, assurance, and tangibles. (See my article entitled, “Customer Service Basics”for more information.)  The expectation that this hotel did not meet was reliability, or the practice of doing what you say you are going to do.  As I fumed over the unreliability of this hotel, I realized that it would have been better if the hotel staff had not promised me any follow-up at all, because to set expectations and not deliver is worse than to promise nothing. Plus, I felt manipulated by the message from the general manager’s assistant, which seemed like a thinly veiled bribe to get me to rate the hotel favorably on the upcoming satisfaction survey.  I wondered whose bonus was dependent on the satisfaction scores.

My reaction was the opposite of what I imagined the hotel intended.  I was determined to complete the survey when I received it, and rate the hotel poorly for their service.  Talk about a process blowing up in their faces!

As contact center professionals, what lessons can we draw from this experience? To reliably follow-up with our customers – when we tell them we will – is a cornerstone of providing exemplary customer service.  Many CRM systems help support analysts do this by providing a “next contact” date field, and providing reminder notices to the analyst that the promised follow-up date/time is approaching. Many systems can also send an alert to the analyst’s manager when the promised follow-up date/time has passed. Contact centers without that kind of alert mechanism in their software must be more vigilant about tracking follow-up commitments manually. In this situation, analysts must be constantly reminded about the importance of doing what they promise to a customer.

Managers should also coach their analysts to set expectations that have wiggle room built into them. In this manner, your analysts will “under-promise and over-perform” for the customer. For example, if an analyst thinks she can call-back a customer in two hours, she should tell the customer to expect a call within five or six hours, just in case she gets involved in an urgent issue that demands her immediate attention. If she calls earlier than that, the customer will be impressed with her over-performance.

Under-promise and over-perform was the opposite of the service that the hotel provided me.  Rather, it over-promised and under-performed. I came away deeply unsatisfied, and miffed at the false expectations the staff set with me. Customers vote with their feet when they are dissatisfied, and my feet will not willingly be crossing the threshold of this hotel, or any others in this franchise, in the future.

We’ve heard from many pundits that customer loyalty is priceless.  In fact, customer loyalty is a large contributor to the profitability of a company.  This is because it is less expensive to service an existing customer than to acquire a new one.  Customers who receive outstanding service from a company tend to return to do more business with you.  As customer support providers, we have the power, on a daily basis, to contribute to the profitability of our companies by how we treat our customers.

One of the most challenging customer support situations is how to handle an angry or upset customer.  These customers can be nasty, demanding, emotional or worse!  Yet, the degree of professionalism that we use when handling these customers will either drive them away from our companies or create a loyal customer.  Let’s face it – everyone makes mistakes, so as organizations, we’re bound to anger or inconvenience a customer here and there.  It’s how we recover from the mistake that separates the good from the great.

Here’s a 5-step method to deal with angry or upset customers that is, in my experience, bound to turn an ugly situation into a positive experience, for both you and your customer.  It’s called LEAF Plus One.  This technique gives you the opportunity to turn over a new “leaf” with your customer and create a satisfied, loyal customer.

With practice, you will get to the point where you look at angry customers as an opportunity: An opportunity to create a really loyal customer.  There are several formerly angry customers that I handled this way who are now my good friends.  From angry to friendly – that’s what we all want.

Let’s examine each of those steps.

L stands for Listen.

Psychologists have a word for the kind of listening that you need to do with an angry customer: active listening.  First of all, be quiet, but not too quiet!  If you’re on the phone, use what I call comforting murmurings: hmm, uh uh, I see, is that so, yes. This assures the angry person that you are paying attention.  It is the verbal equivalent of looking someone in the eyes, which is certainly what you should be doing if you are interacting in person with the angry customer.  Let the person vent.  They probably planned exactly what they were going to say, so don’t interrupt!

Do another thing:  Be writing down each of the key points that this incensed person is bringing to your attention.  This is for two reasons: so you can paraphrase his/her concerns to make sure you understand the problem, and so you can be making your plan of how to solve the problem while you are listening.  When they are done venting to you, say, “If I understand you correctly, here’s what the problem is….” Paraphrase the problem and get their OK on your understanding of it.

There are 2 things to avoid in this listening phase: do not meet the impassioned outburst with silence on the phone, and do not start arguing with the customer.  Silence is perceived as one of two things by the customer: indifference or hostility.  That’s why we practice our comforting murmurings.

Arguing is the kiss of death.  It only serves to escalate emotions. Remember that, although the customer may not always be right, they are always the customer.  Customers represent job security for you!  Even if they are wrong, they deserve your utmost respect, which means that you find areas to agree on, not DISagree.

E stands for Empathize

Scientists now know a lot about how our brains work.  For example, we know that our limbic system, the part of our brain that controls our basic emotions, is much stronger than our neo-cortex, which is the part of the brain that controls our logic.  When someone is angry, their limbic system is bullying their neo-cortex and making it impossible for logic to prevail.  If you don’t acknowledge their emotions, they tend to stay stuck in their feelings and have a hard time using their analytical abilities.  The best way to get someone out of their limbic system is to acknowledge their emotions with empathy.

Now, let’s not get empathy confused with sympathy.  Sympathy is when you say, “Poor baby, let me make it all better”, whereas empathy is imagining what it might feel like to experience what the other is going through – it’s walking a mile in their shoes.  When I was in charge of a large software support group, my colleague Susan Long used to say that she empathized with callers who were not proficient with computers by imagining how she would feel if she was calling an auto shop to get help in changing the oil in her car.  That’s empathy.

By using empathy, you acknowledge the emotion of the situation.  If not, you have missed the opportunity to connect with this person on a personal level, which is the only way to dispel anger.  Use words such as ““If that happened to me, I’d be frustrated, too” or “Gee, I can see why you are irritated by that”.

A stands for Apologize

The rule of thumb for when it is appropriate to apologize is, “If your company has made a mistake, by all means, apologize about the situation.”  Notice we said “if your company” – you need not take blame for what some dodo in accounting did, but you must take ownership of the situation.  Never, ever point a finger at another part of your company, as in “Oh, those accountants, they’ve done it again!”  Remember, the customer doesn’t know or care about your company’s organizational chart!

In his book, “Moments of Truth”, Jan Carlson, CEO of SAS Airlines, tells us that whenever you have an encounter with a customer, you represent the whole company in that interaction.  The customer builds an impression of the entire company by how you treat them at that moment.  They don’t care that you work in a different building from the person that created their problem; they just want you, as a representative of the entire organization, to take ownership and fix the problem.

Quickly take ownership of the problem by apologizing.   So many companies and service people miss out on this step – it is vitally important.  You needn’t take the blame, but apologize for the situation by saying “I’m sorry you feel frustrated”, or “I’m so sorry that happened.  Let me fix that for you.”  Sometimes that simple “I’m sorry” can make all the difference in the world.

I had a recent encounter with a vendor who made a big mistake on an order of note pads I ordered from her.  They were not ready in time for my first training seminar, and I had to make do without them.  I called her to let her know about the situation, and she immediately apologized sincerely and profusely.  My anger was diffused, and all I could say to her was “Thank you for the apology”.  She made good on the order and it arrived soon after.

F stands for Fix:

You’ve listened, you’ve paraphrased, you didn’t argue, you acknowledged their emotion and apologized for the inconvenience – now what do you do?  Here’s where the rubber hits the road.  Ask:

What can I do to make you happy?

Now that you’ve met the person’s emotional needs, you need to outline a plan of action to the customer.  “Here’s what I’d like to do to fix this problem”.  The key here is the “I”.  Take ownership of the problem, even if it was the shipping department’s problem.  The customer only knows you as one company, and doesn’t know or care about the other department’s mistakes.  Now, work your little rear-end off to correct that situation.  Under promise and over perform.

Plus One:

This step is what separates the good from the great.  The great companies will not only do all the steps that we’ve outlined here so far, but they will compensate you for your trouble by adding on something extra.  This is really what cements a customer’s loyalty.

Here is a story that illustrates the power of Plus One:

When I was 3 months pregnant, I had to take a business trip to Chicago.  If you or someone near and dear to you has ever been 3 months pregnant, you know how easy it is to get emotional.  Those hormones just take over!  I had one and only one appropriately corporate-looking skirt that I could still fit into with my growing waistline – but I had torn it on my last business trip and it needed to be re-woven.  So I brought it back to where I bought it – Nordstrom in San Francisco – and asked them if they could fix it in time for my business trip in 2 weeks.  They indicated that it would be ready by then.  On the day before I left for Chicago, I had received no word from Nordstrom, so I called to find out about my skirt.  “Oh no,” said the clerk who answered my call, “That skirt just went to the re-weavers yesterday and won’t be back until next week.”  I lost my cool.  “I’m 3 months pregnant and that’s the only nice skirt I have that still fits, and I have to go to Chicago tomorrow morning”.  I was hysterical!  The clerk responded, “Can you come into the store today?  I’ll have a similar skirt in your size waiting for you”.  When I arrived at the store, there was a beautiful skirt, wrapped up in tissue paper waiting for me.  It fit perfectly!  I went back to the sales desk and offered to bring the new skirt back when I returned from my trip, but they refused saying, “Oh no, that skirt is for you, for your inconvenience”.  Before I left the store, I just couldn’t help myself, my curiosity was too strong – I looked at the price tag on similar skirts hanging on the racks – that skirt cost $198.00.  That, dear readers, is Plus One.

And where do you think I do most of my clothes shopping, for both my family and myself?  You got it, Nordstrom.  In fact, only a few years later, I refused to move to a new city until I read that Nordstrom had just opened their first store there.

What can you do to Plus One?  You can institute a culture of customer service from the heart by empowering your employees to make it right with the customer.  On the no- or low-cost side, you can encourage them to call back customers who were inconvenienced to make sure they are OK.  You can write a hand-written note to the customer, thanking them for their understanding and their business.  You can leave them a mint and a quick note on their desk if they work in your company (remember, customers don’t always work outside of your company).   In a software company in which I ran the customer support organization, we used to have company t-shirts and a chocolate bar that any technical support representative could send to a customer for any reason – no questions asked.  We also empowered the tech support reps to send a complimentary supplemental report that enhanced the usage of our software to a customer when they needed to compensate for any inconvenience.  We figured that the cost to us of sending the report was just the cost of a computer disk and postage, even though the market value of the report was $500.

The power of Plus One is that it creates extraordinarily loyal customers.  It is so rare today.  It creates a WOW! in the customer’s mind, and builds a loyal customer base for your increasingly profitable company.

Once we know how to deal with angry or upset customers, it seems simple:  We actively listen to our customers and let them vent.  We empathize with them to acknowledge their emotions.  We apologize in order to take ownership of the problem.  The fourth step, fixing or trouble-shooting is easy for us as customer support analysts – that’s what we love to do!  And the last step, Plus One, is our opportunity to create a lasting positive impression on the customer and turn that angry customer into a delighted one.

LEAF Plus One.  Isn’t it time to turn over a new leaf with your customers?

Listen

Empathize

Apologize

Fix

Plus One

Are you looking for a way to increase the effectiveness of your knowledge management process?  Many support organizations find that their knowledge management methodology fails to produce incremental benefits after a time, and they look for an improved approach.  That improved approach might be Knowledge-Centered Support.

Knowledge-Centered Support (KCS^SM) is a methodology created by the Consortium for Service Innovation and is based on the premise that empowering all support analysts to structure, create, modify and reuse knowledge is the key to effective problem solving in the support center.  KCS seeks to change the way that you create and share knowledge. KCS breaks down the barriers between levels of support (such as Tier 1, Tier 2, etc) and helps you build a culture of collaboration within your company.

What is the typical way of creating knowledge?  In my consulting and hands-on experience over the years, I’ve observed many support centers follow some variation of the following process:

While this works well for many centers, this process has several potential drawbacks:

The process is time consuming, and can delay the sharing of time-sensitive information until the knowledge article has gone through several levels of editing and approval.  Bottlenecks in the process flow can slow down the publication of new articles.
It confines the participation in knowledge editing and perhaps even creation to a small group of knowledge engineers.  Sometimes the process excludes the frontline support analysts (the ones who may know the most about how the customer uses the knowledge) from the creation or modification of the information.
The knowledge created is divorced from the context of the original support interaction, thus making it impossible to capture the language of the customer in describing the problem.  The language that the customer uses on the phone is likely to be the same that they use when they search the self-service web portal – and if you haven’t captured their quirky, non-technical description of the problem, they will never find the solution using that same quirky, non-technical terminology.

KCS directly addresses these drawbacks and enables both better internal (within the support center) and external (with the customer) knowledge sharing in these ways:

1. KCS asks the support analysts to structure and create knowledge within the process of providing support to the customer.  It expects the analysts to search for a knowledge article (called a solution in KCS) during each support interaction and to do one of four things:
   1. Create knowledge if a solution is not found
   2. Edit knowledge if the solution found is incomplete or incorrect
   3. Flag the solution if the correct solution is not known
   4. Use the solution by linking it to the case management record
2. All support analysts are trained and licensed to participate effectively in the knowledge creation process.  They are coached by a peer to continuously improve their knowledge creation skills and effectiveness.
3. All support analysts are trained to capture the context of the customer within the solutions they create, thus ensuring a better online search success rate.

KCS is an exciting innovation knowledge management.  If you’d like to know more about KCS, please visit the Consortium’s KCS website at www.serviceinnovation.org/kcs.  If you’d like to schedule a free, 30-minute consultation on the benefits of KCS to your organization, please contact Kristin Robertson at krisrob@krconsulting.com.

Have you started planning for next year? Even if your company is not on a calendar fiscal year, the end of the year is a natural time for all of us to pause, reflect and project our desires on the future.  This tendency also holds true for the call center or support center manager – for many support centers, the holiday season is the calm before the storm of high call volumes that the New Year brings.  For others, the holidays are the busiest time, so now, in early November, is the best time to take a breath, take out your crystal ball and imagine what your call center or support center will look like in a year or two.

The act of imagining what the future holds is the first step in creating a strategic plan for your call center.  All managers (yes, I mean you) should take the time to create a strategic plan that spans at least two years into the future.  There are several specific techniques mentioned in my book, Spectacular Support Centers^[1], that might help you assess your current situation, identify future challenges and plan for them.  In this article, we’ll talk more about the benefits of a strategic plan and what it should include.

Many smaller call centers, help desks and support centers lack a strategic plan, thinking that they do not need to invest the effort involved in developing one.  No matter how small you are, you are still the voice of the company when you answer phone calls and electronic inquiries.  More important, your organization is the eyes and ears of the company, seeing and hearing customer’s concerns, complaints and kudos each and every day.  It is important that the frontline call center managers understand the current situation of their organizations and what they need to change or improve to provide the best first impression and the best service possible.

The current situation

All strategic plans must start with a current situation analysis.  Typically, call centers focus on three areas of excellence, which are people, process and technology.  Using this structure, you might ask the following questions: What kind of people programs do we have right now?  What training, hiring, recognition and retention programs do we currently offer?  What processes are working well at present?  Are they documented and stored in a central online repository so everyone has access to them? Have we flowcharted all our major processes? Do we share knowledge effectively?  Are there any bottlenecks in our call or email handling process?  Do we have an effective escalation process?  What tools do we currently use, including telephone, call tracking, knowledge management and online self-help tools?  How well does each tool work, and how well each tool is accepted by the analysts and the customers?

In creating the current situation analysis, obvious challenges will emerge.  Perhaps it is the lack of acceptance of self-help by customers, or the outdated telephone system/ACD, or a high turnover rate among analysts.  Keep those in mind, but set them aside for a moment.

Predicting the future

Now, imagine what the environment is going to be like in one and two years.  What might happen inside the company?  What might happen to your industry?  What might happen to the employees?  What new technologies will you have to deal with, or will be available to the support center?  You might need to conduct some research on the web to discern these trends.  This is important work.

Now that you have the current situation and the challenges or changes that you might face in the next two years, you are ready to construct a strategic plan for the call or support center.  You may again use the structure of people, process and technology as the basis of your plan.  In this document, build your plan for how you are going to address the challenges you identified.  Justify the investments that you might need in order to meet the challenges.  Describe the process improvements that will position the group for improved customer service, or to just stay current with industry trends.

With these tips, year-end planning should be less intimidating than you might have thought.  The important thing is to take time, in a quiet place, to think about your future plans.  When I was a support center manager, I enjoyed this process immensely because it took me out of the fire-fighting mode of everyday living and allowed me the time to dream big dreams for my organization.  Happy dreaming!

[1] Kristin Robertson, Spectacular Support Centers, (Bolton, MA: Customer Service Press, 2007).  Available at www.spectacularsupportcenters.com

A support center’s quality monitoring (or call monitoring) program is an essential element in providing excellent service to customers. There’s a direct correlation between how analysts treat customers to how satisfied and loyal customers are to the company. Quality interactions help you retain your customers and grow the business. More and more companies find that they can no longer sell solely on the features and benefits of their products, because those products have become commodities. Instead, they must compete on the quality and types of service they offer. The spotlight is on service, so quality must be on the forefront of every support manager’s mind.

There are many benefits to establishing a quality monitoring program for your phone-based analysts including a means to ensure consistent and professional service, to enforce customer service skills learned in training, to demonstrate to analysts how important customer service is, and to approximate and measure what your customers think of your service. The goals of a quality program are to ensure consistent, high quality service, recognize analysts who are doing a great job, and identify opportunities for analyst training. Results of the quality monitoring evaluations are often included in analyst scorecards with other, more tangible metrics such as number of calls handled, average handle time, and first contact resolution rate.

Creating a quality monitoring program takes a bit of time and thought, but is well worth the effort. Here’s a seven-step process to create a quality program that reflects your unique support center environment.

Step 1: Define/Redefine Critical Success Factors

The very first step in this process is to identify a task force, composed of both support analysts and support managers, to work through this process. Together, the team can identify goals, define intended outcomes, and assign tasks to individuals to achieve results.

The task force needs to define what constitutes success for this project. In doing that, some important questions to answer are:

• Why are we doing this?
• Who is going to be involved in this, and to what degree?
• What outcomes do we want to see?
• When do we want to monitor for quality, and how often?
• How will we measure our success?

Clarifying objectives, expected results, and metrics at this point influences all subsequent work and ensures understanding across the task force.

Step 2: Observe Key Analysts

Every support center has its star analysts. During this step, ask both management and analysts to identify a small group of analysts who are exemplary customer service providers, using available criteria. The task force then observes these analysts as they handle customers, and analyzes the interactions to identify structural elements of the call as well as best practices in handling the customer’s requests. Members of the task force will listen to calls, observe how the star analysts use their support tools, and how they structure their work. You can then map out the common elements of your group’s interactions with customers. Compiling the information from this research will direct the next step in the process.

Step 3: Create an Interaction Structure and Elements

Next, the task force outlines the structure of a successful interaction by defining the elements identified while observing the star analysts. All calls will, at minimum, have three phases: a greeting, the problem-solving or request-handling step, and a close. Within that structure, define the behaviors, or elements, that create successful interactions with customers. There are two types of elements to keep in mind: procedural steps, such as gathering the correct information from the customer; and customer service behaviors, such as using a standard greeting, showing empathy, using the customer’s name, employing an appropriate tone of voice, etc. The procedural steps will be unique to your situation, but the customer service skills are universal. Capture the star performers’ best practices in both areas by creating a flow diagram of a typical interaction. If you have a wide variety of call types, you may need to define several kinds of interactions.

Step 4: Create a Call Evaluation Form, Legend, and Analyst Scorecard

Using the structure defined in the previous step, the task force creates an evaluation form for quality monitoring sessions. The form lists all the elements, in question form, that an analyst should follow during the interaction to solve the problem and satisfy the customer. Some elements you might want to include on the evaluation form are:

• Did the analyst use the department’s standard greeting?
• Did the analyst properly identify the problem?
• Did the analyst use active listening skills with the customer?
• Did the analyst use effective questioning skills to diagnose the problem?
• Did the analyst headline any dead air space during the call?
• Did the analyst use proper on-hold procedures?
• Did the analyst make use of available resources to solve the issue?
• Did the analyst set expectations for follow-up after the call?
• Did the analyst use the department’s call closure guidelines?

A legend accompanies the evaluation form, and defines in detail the behaviors expected of the analysts in each step of the call structure. The legend can include suggested wordings for each element of the evaluation. These phrases should be ones that are proven, through the experience of your star performers, to work well with your customers.

Don’t forget to include call evaluation scores on a monthly summary or scorecard of each individual’s performance. The scorecard generally includes both quality metrics and performance metrics such as number of calls handled, average handle time, and first contact resolution rate.

Although many support centers grade calls using a 1-5 score system (similar to a customer satisfaction survey), a yes-no grading system is undeniably simpler. Says Tracy Coleman, Senior Manager at CompuCom System’s Enterprise Help Desk, “We use a yes-no grading system. The analysts either did what you expected or they didn’t.”

Step 5: Create Interaction Monitoring Process

In this step, gather the answers to the questions identified in Step 1, and create the process flow for your quality monitoring program. The task force documents exactly who will be doing what, and what tools and techniques will be used. Be sure to include the answers to questions such as “How many times will each analyst be monitored each month?”, and “How will we record both the call and the evaluations?”

Recording calls is an important step in the quality monitoring process. It’s important for the supervisor to be able to listen several times to a call, but most significantly, it’s beneficial for the analyst to listen to their own calls in a calm environment. I once managed an analyst who had a very loud phone voice. Although I mentioned to her that she needn’t speak so forcefully, it wasn’t until she heard her voice in a recorded call that she fully realized how the volume could be unpleasant to a customer.

Many call centers don’t have the budget to invest in expensive call recording technologies. For smaller centers, expensive monitoring equipment isn’t necessary. Fortunately, it’s easy to manually record calls by connecting a common tape recorder to a supervisor’s telephone set. You can buy the tape recorder and connecting hardware for under $100 at your local electronics store. Be sure to get a tape recorder with a meter on it so you can record the location of each conversation you record. Using the supervisor’s functionality on the ACD or phone system, the supervisor dials into an analyst’s extension and records the calls. Roberta Moss, of Medtronic Powered Surgical Solutions, keeps a different tape for each analyst in her center, and records several calls a week in order to have a representative number of monitors at the end of the month. “I mark the tape recorder’s meter number at the top of each call evaluation form,” says Roberta. “That way, I know exactly where to fast-forward on the tape to listen again to the call.”

Then create a document that outlines the quality monitoring process. It helps to outline the tasks in a weekly, monthly, and yearly format. If you agreed, for example, that each analyst should have two coachings per month, your quality process outline might look like this:
Weekly Tasks:

• Record and evaluate calls for half of the analysts on the team.
• Prepare coaching for each call evaluated.
• Coach analysts.
• Record evaluations in a spreadsheet (or database).

Monthly Tasks:

• Run summary reports.
• Incorporate quality scores into analyst and department scorecards.

Yearly Tasks:

• Run yearly summary reports.
• Incorporate quality scores into annual performance evaluations.

Step 6: Train and Pilot

Any new process is going to have wrinkles that need ironing! Conducting a pilot program, in which you roll out the new program to a smaller group of analysts, provides an opportunity to test new processes. Training is an important part of this step, as the analysts need to adopt new habits and behaviors. Training should emphasize the “What’s in it for me?” aspect, from the analyst’s point of view, of the program. Recognizing a job well done is typically a good motivator for the training program. After a few weeks of the pilot program, the task force should get together to assess what went well and what didn’t, and tweak the process before implementation.

Step 7: Implement

Training will be repeated for all the analysts during the Implementation phase. You’re now ready to rollout the program to the entire support center, and start reaping the benefits of your hard work!

A quality monitoring process should be reviewed and improved periodically via feedback loops within the support center. That’s why the process of creating a new quality program is a continuous cycle. Coleman cites a new program at CompuCom that demonstrates how one company continuously improves its quality monitoring process. CompuCom started a new program called “Put a Face on the Caller” to ensure that basic customer service skills are used in their support center. This back-to-the-basics program allows any supervisor or manager in CompuCom’s large center to listen to and critique the customer service skills of any analyst, regardless of that supervisor’s technical or process knowledge of the applications supported. This evaluation form is devoid of process questions that are account-specific and focuses only on the interaction skills of the analyst. “This new layer in our quality monitoring program has focused our analysts on putting a smile on the customer’s face through superior service,” reports Coleman.

Quality is an elusive goal, but with a solid quality monitoring program in place, your support center can indeed put a smile on the caller’s face.

Kristin Robertson, KR Consulting, Inc.
September, 2006

Readers are leaders. That simple statement is true because people who are continuously updating their knowledge, skills and outlook are generally those who excel in life. Those are the people who naturally lead others. All support center managers owe it to themselves to develop a reading habit to keep their skills sharp. In the United States today, only about 12% of the population reads books on a regular basis.  In contrast, most Chief Executive Officers, who you would think would already know everything they need to know, read a book a week on average.  These CEO’s know that they have to keep themselves at the top of their game, and one way to do that is to read books. For most of us, a reasonable goal is to read one book a month.

I have always loved to read. I read widely and wildly.  I am usually in the middle of about five books, often on very different topics.  My bedside table at home reflects my eclectic taste – it is piled high with books that I’ve read, meant to read, or are currently reading.  Because of my voracious reading, I’ve picked up some tricks over the years that enhance the effectiveness of my reading, and I’d like to share them with you in this article.  As you will see, my reading habit has helped me greatly.

How to incorporate reading into a busy day

Feeling some resistance to developing a reading habit?  I can just hear you protesting, “But I don’t have time to do one more thing in my life!”  Of course, we all live hectic and busy lives, but there is always time for activities that are important to you.  Reading is important to your success in your career and in your life.  There are many ways to find time for reading.  One of the most popular times to read is during a biological activity that each of us engages in multiple times a day – of course, that is using the bathroom.  In my home, we call the bathroom the “Reading Room” because we always have books piled up beside the toilet.  This is the true meaning of multi-tasking.  I’ve even seen people in offices escape to the restroom with a newspaper in hand.  Well, maybe that’s pushing it, but you get the point.

Another time to read is right before you go to bed. I suggest that you be very careful what you experience before going to sleep, as it will affect your dreams and the quality of your rest.  Therefore, the nightly news is not advisable as the last thing you do before turning in. It is full of bad news, and its grizzly images make a huge impression on your brain and psyche. Seeing the nightly news can contribute to insomnia! Rather, read a few pages or a whole chapter in a book, preferably not an action thriller that will key you up.  Non-fiction or an easy novel is good evening reading.

I do a lot of travel, and find that the time in an airport or airplane is wonderful private time to catch up on my reading.

In your personal reading, don’t feel like you have to finish a book in order to benefit from it.  This applies to both fiction and non-fiction books.  Clearly, if you don’t like a novel you start reading, you just shelve it and move on.  But many of us view non-fiction books differently, that for some reason, once you’ve started reading a book on management practices, for example, you have to read the whole thing.  I challenge that, and suggest that if you have culled a few good ideas from a book and are no longer interested in it, put it aside and find another.  Certainly, if you cannot find any benefit in the book you currently are reading, it is time to move on.

Lastly, make reading a habit in your support center by encouraging your employees to read books and present book reports or book summaries at your weekly team meeting.  This is one way to present customer service skills training: an analyst reads a book on customer service and presents her findings to the group, perhaps even incorporating a group exercise into her presentation.  I know several support center managers who insist on this practice as a weekly discipline.  One benefit of this, among many, is the creation of a learning organization that shares knowledge.

Three Reading Techniques

There are three more tips that I would recomend about reading that may help you enhance your enjoyment of this fine art:

1. When reading non-fiction, annotate the book as you go along so you can easily remember the important points.  When I come across something that I want to remember, I do two things:  I underline the passage, then turn to the front inside cover of the book, and on the blank page there, I write down the page number and a short sentence that summarizes the concept.  When I have finished the book, I often have both the inside front and inside back covers filled with notations.  When I want to remember what was in the book, I simply open the cover of the book and read my own “Cliff Notes” version of the book.

I tell my teenage children, “If you can read a book, you can learn anything.”  Read by annotating, and you will not only learn it, you will retain it also.

1. If you read seven books by different authors on the same topic, you will become an expert on that topic, especially if you follow my annotation tip, above.  I heard this advice from a friend who taught himself mortgage lending by reading widely on the topic.  He now runs a mortgage lending company. I myself have learned about Emotional Intelligence by reading many more than seven books on the topic, by many different authors.  Even though I have also attended classes on the subject, I felt that my reading prepared me to be an equal to many in the class who have formal educations in organizational development.

1. Make it your goal to always read a book that makes you a better person.  This could be a spiritual or religious book, or perhaps a book on the topics of diet, health, stress management, or self-help.  I will let you define for yourself what books make you a better person.  In this way, our reading can truly elevate our lives and our perspectives, and equip us with new and important tools for life.

Readers are Leaders

My mother always said, “An education is no burden to carry.”  By making reading a habit, we all embrace a life style of continuous self-education.  Your career will benefit. Your quality of life will improve. Remember, readers are leaders.  Plus, reading is just plain fun.

So, you’ve decided that your support center needs a new tool.  Whether it’s an Automatic Call Distributor (ACD), contact tracking software, email management system, knowledgebase, or web-based support product, gaining approval for your purchase from top management can be a major hurdle.  There are two games to play in gaining approval for your purchase: the financial and the political game.  Creating a compelling financial picture of the benefits gained with the new technology is the first game and is vitally important, especially when you play this game well. However, creating a complex spreadsheet with ROI calculations does not always guarantee you the nod from the ultimate decision maker.  The hidden game in gaining management approval is political persuasion.  Let’s look at both games as they intertwine themselves to make a successful justification project.

There are six steps to justifying your purchase:

Pitfalls to Avoid

Before proceeding to a detailed discussion of the steps, it’s important to know what not to do in justifying your purchase.  Here are the pitfalls to avoid in presenting a Cost Justification Analysis:

• Under-estimating the costs
• Under-estimating the time involved in the implementation
• Over-estimating the savings/benefits
• Using the wrong evaluation criteria
• Failing to find a project sponsor
• Failing to align your purchase with company strategy

By following the steps outlined in this article, most of these pitfalls can be avoided.  However, sometimes it is difficult to avoid all snags.  Correctly estimating implementation time (and therefore costs) increases in difficulty in direct proportion to the size and scope of your project.  However, if you conservatively estimate the savings and benefits of your project, you allow yourself some room to err on other calculations.

Step One: Talk to the Decision-maker

As with so many things in life, the first step is the most important!

Who is the person that will ultimately approve or nix your project?  This is the person that you must meet with to discuss your project, preferably before you even start looking for a vendor or a specific product.  The goals of your meeting are to alert the Decision-maker to the problems that you are facing, explain how you think technology could help you solve it, and understand what would persuade him/her to OK the purchase.  This is the heart of the political persuasion game.

However, there are some steps to take before scheduling this meeting.

First, find an Influential Ally.  Is there another department or organization in your company that would benefit from implementing the tool that you are seeking?  For example, a knowledge base might be used by sales to record information that they need to handle prospective customer’s objections or requests for information.  Or, a contact tracking software might have an add-on module that provides asset management, which would be very helpful to the entire IT department, or a bug-tracking system, which could be used by the Engineering or Product Development group.  If you manage an internal Help Desk, it would be ideal to find a non-IT executive in your company who is a champion for the Help Desk, and persuade that person to become your ally in the purchase approval.

Although it is not necessary to bring your Influential Ally to the first meeting with the Decision-maker, it is very helpful to gain that person’s endorsement, which you will mention to the Decision-maker.  Talk to the Influential Ally, and discover how they think your new purchase would benefit their department.  Write down the benefits.  Also ask this person for advice on approaching the Decision-maker, and if they’ve had success in gaining approval for expenditures in the past.  Note all strategies used, and any people that were helpful to him/her in the effort.  Follow-up on all suggestions offered.  You are gaining valuable information on what is important to the Decision-maker and what approach works best.

Next, if the Decision-maker is not your boss, get your boss to participate in approaching the executive. The two of you should together schedule a meeting with the Decision-maker and strategize how best to approach that person.  Make a written game plan on how to structure the meeting.

After presenting your situation, here are some questions to ask your Decision-maker:

• How do you see this purchase fitting in with our corporate strategy? (Be sure to present your thoughts on this first!)
• If I could show you that a purchase will save us money in the long run, would you be interested?
• What financial calculations do you base your purchasing decisions on?
• What evaluation criteria do you prefer: Return on Investment, Net Present Value, internal rate of return, simple return, payback (have examples of each to show)?  All of the above?  None of the above?
• Would you like to compare 2 or 3 vendor’s costs in the study, or just the finalist that we choose?
• Can you share with us successful ROI or Cost Benefit studies for purchases that have been approved in the past?

It is extremely important to discover exactly what information this person needs to make a decision.  I have learned this the hard way.  In working with the CFO of a large corporation to gain approval of an enterprise-wide system, I mistakenly assumed that this person would need in-depth and complicated spreadsheets showing all of the complex financial calculations (NPV, ROI, IRR, payback, etc) used to test purchase decisions, and worked hours to create it.  I was wrong!  What he wanted was something similar to this straightforward form:

On the other hand, other companies that I’ve worked with require a very formal and in-depth ROI study, and I’ve toiled for days to create complex spreadsheets and cost-benefit studies for them.  The important point is to find out exactly what your Decision-maker requires to facilitate gaining approval of your purchase.

Be sure to keep the Decision-maker in the loop about your activities surrounding this purchase.  It keeps your project top-of-mind for that person, and makes it easier for you to come back at the end and discuss the purchase.

Lastly, it’s a good idea to befriend someone from Finance or Accounting at this stage, or ask the Finance Manager to recommend someone you could be working with in the future. You need someone who can help you calculate the financial return formulas.  Ideally, this person has experience in creating Cost Benefit and ROI analyses, and can be your partner in preparing your case for approval.  Once you identify your Finance/Accounting analyst, visit that person to tell them what you are doing and seek their advice in gathering the data.  Tell them you will need their expertise in preparing the return numbers.  Treat this person like your best friend, since you will be very grateful for their assistance in the future!

Step Two: Quantify Benefits

Although it requires effort, this step really is the fun part of an ROI or Cost Benefit Analysis.  In it, you calculate the anticipated savings associated with using the proposed tool.

In a support center, benefits generally boil down to one main line item: reduced headcount.  By improving productivity or reducing time required for any human-mediated activity, you eventually arrive at a lowered headcount.  Be aware that this gets tricky, because when you start discussing reduced headcount, you get two knee-jerk reactions.  On one hand, your representatives get nervous because they fear they’ll lose their job, and on the other, executives rub their hands in glee, thinking that they’ll get to reduce the cost of the support center by reducing the overall headcount.

What really happens when you increase productivity in a support center is you “Decrease the Increase” in headcount.  Without tools to increase productivity, the demand for more agents in the support center increases in direct proportion to a growing user base or the number of products sold.  What you attempt with support tools such as an ACD, IVR system or an e-support tool is to improve the ratio of customers to representatives, so each representative can serve a larger number of customers.  However, decreasing the absolute number of representatives in the support center is rarely achieved, for two reasons.  First, technology is proliferating, as seen in more frequent updates to existing systems and the increasing number of technology-based products customers use on a daily basis.  This creates an ever-increasing demand for service on those products.  Secondly, many of the current technology tools are designed to automate and off-load easy, quick questions from customers.  That means that the human-mediated contacts are more complex and take longer to handle. Longer handle times in a contact center increases the need for agents.  Therefore, we generally see a ‘Decrease the Increase” situation, which can be graphed as follows:

The yellow portion in the graph above represents your headcount requirements without implementing productivity-enhancing tools, and the blue portion represents your anticipated headcount with the tool.

So, where do you find the drivers of a “decreased increase” in headcount requirements?  Here are some metrics that could be quantified to show a reduced need for headcount.

Drivers of Decreased Increase in Headcount are:

• Call Avoidance or Call Deflection (as seen with e-support or IVR functions)
• Decreased Average Handle Time of rep-assisted contacts
• Decreased new hire training time
• Lower Headcount needed to dispatch incoming contacts (either email or voice)
• Improved Agent Retention (attrition costs a company between 2 and 7 times the agent’s annual salary)
• Reduced Performance Penalties, if applicable
• Reduced Headcount needed to do routine reporting
• Lower Computer or facilities cost
• Decreased Data Entry errors
• Decreased Telecom costs
• Reduced or eliminated Management time spent creating ad-hoc reporting or assembling reporting
• Reduced Downtime of user community

But before starting to quantify benefits, you must have a projection of what your costs would be without your new purchase.  Generally, you project costs over the life of the purchase, which is usually 3 or 5 years, depending on your company’s accounting practices.  Check with your finance analyst for specifics.  You first need to project the number of contacts you expect to receive if you don’t implement the new support tool, over the next 3 or 5 years. Next, you’ll project the number of representatives you’ll need to service those contacts, and the cost of hiring, training and retaining them.  Now you have a baseline that quantifies what will happen if you don’t implement the new technology.

Now you can quantify the savings anticipated by examining the Driver of Decreased Increase in Headcount, above, and quantifying the results of each item.  Re-work the projected headcount requirements for the next 3 or 5 years, this time taking into account the reduced contact volumes or reduced average handle times that the new technology will enable.  Eliminate the cost of some current positions, if applicable; for example, you may be able to re-deploy employees who are currently dedicated to reporting or data input.  If you are an internal help desk, you can quickly gain the attention of upper management by quantifying the value of reduced downtime in your user community, especially if many of your users are highly compensated employees.  I worked with one internal help desk that used this one metric as the entire justification for their technology purchases in starting up a new help desk.  It came to an astounding dollar amount!

Some people can get carried away with showing benefits by calculating dubious savings or putting a hard-dollar amount on soft-costs, such as improved customer satisfaction and retention.  I suggest that in your presentation to your Decision-maker you list and describe the soft-cost benefits that you anticipate, but conservatively omit their quantification.  This gives you some wiggle room in the ROI.  Since I advocate that you re-do your ROI study a year after implementation, that would be the time to quantify soft costs if you can and show even greater ROI than expected.

Step Three: Quantify Costs

This is thankfully a little easier than the previous step.  You must consider the Total Cost of Ownership (TCO) over the 3 or 5 years in which you depreciate your purchase.   Your chosen vendor or vendors can help you with much of this step.

Some companies expect that you will compare ROI’s on several vendors’ solutions.  Hopefully, the benefits will be the same or very similar and you’ll only have to create those calculations once.  However, the costs will be different, and Step Three may need to be repeated for several vendors.

Your vendor can provide projected costs for the proposed solution.  This must include all costs associated with the solution, including:

Capitalized Costs:

• Software purchases
• Hardware and OS purchases
• Implementation costs (especially in the case of Customer Relationship Management (CRM) implementations, this amount can be many times greater than the cost of the software/hardware)

Non-capitalized Costs:

• Maintenance and upgrades for the life of the purchase
• Future consulting fees
• Salary costs (fully burdened) of any additional internal headcount needed to maintain system

The first three items above are generally considered capitalized costs, which means they can be reported on the Balance Sheet of the company, and depreciated over the life of the asset.  Be sure to check with your finance department about capitalized vs. non-capitalized items, as they may have a different opinion on your specific situation.

Step Four: Create the ROI

You already know how complex your study must be, because your Decision-maker told you in Step One.  Perhaps you are lucky enough to possess a copy of an ROI analysis that was approved in the past.  Steal shamelessly!  Copy both the basic format and the formulas used in that study and improve on them if you can.

Once you’ve completed the legwork described in Steps One through Three, you’re ready to return to your Finance or Accounting buddy and start to work on the analysis.  Bring all your supporting data to that person, and be prepared to roll up your sleeves!

A format that’s been successful for me is to create a spreadsheet with multiple worksheets, one each for Assumptions, Costs, Benefits and ROI.

• Assumptions Worksheet gathers all your current business metrics and projects them over the next 3 or 5 years, depending on your company’s accounting practices.  You quantified these metrics in Step Two, “Quantify Benefits”
• Costs Worksheet displays the Total Cost of Ownership numbers that you prepared in Step Three, “Quantify Costs”.  Separate your costs into Capitalized Costs and Non-Capitalized costs, as discussed above.  Your finance buddy can help you sort your expenses in to the two categories.
• Benefits Worksheet details the benefits that you anticipate from the new tool, and that you carefully calculated in Step Two, “Quantify Benefits”.
• ROI Worksheet presents the financial calculations that you and your Accounting/Finance helper will calculate.  You should already know what evaluation criteria that your Decision-maker is expecting, and that could be some combination of Net Present Value (NPV), Internal Rate of Return (IRR), Return on Investment (ROI), Payback Period, and others.

You might also want to prepare a document that summarizes your findings and presents the soft-dollar benefits that you anticipate.  Soft benefits can include:

• Improved customer satisfaction and loyalty
• Improved company image
• Improved employee satisfaction and loyalty
• Better management data and reporting

Sometimes the soft-dollar benefits can be more compelling than any fancy financial formulas.  Many years ago, I was in the position to justify the purchase an Automatic Call Distributor (ACD) system to the President of my small software company.  It was a huge expense for that company, but the main evaluation criteria became the image of the company to our clients.  Indeed, a client had called the President and asked her why we hadn’t invested in a really good telephone system.  We needed to appear bigger than we really were, and made this purchase because of that.

By the way, your vendors probably will want to do the ROI study for you.  You can bet that they will paint a very rosy picture, which may not be as realistic as you’d like. You can certainly take them up on the offer, but keep in mind what the vendor’s motive is – to sell the product – and use their analysis as a starting point.  Especially in the area of Benefits, be sure you take control of the justification.

Step Five:  Present to Decision-maker

If you’ve done all your homework in Steps One through Five, you should feel very confident in approaching your Decision-maker with your findings.  If you’ve been keeping that person informed about your progress, they will not be surprised to see you in their office again with your report in hand.  Bring your boss or Project Sponsor, and if you think that it might be a hard sell, you might want to bring your Influential Ally with you also.  Be sure to brief your boss and ally before the meeting, and strategize with them about the best way to structure the meeting.

Hopefully, your hard work will bear fruit at this very moment, and you will receive the green light to proceed with your purchase!  However, there may be a number of reasons why your proposal is not accepted at this time.  Remember what salespeople know so well: No only means “Not now”.  If you really believe that your support tool is going to save time and money and/or improve customer satisfaction, be patient and continue to work with management to quantify the need and the benefits. Some of the most successful executives I know are extraordinarily patient, knowing a more opportune time to gain approval and effect change will present itself in the future.

Step Six: After a year, re-do the ROI

This step is unfortunately rarely done, but it gives you great credibility with your company.  After the new system has been operating successfully long enough to collect sufficient data (usually about a year), re-visit your ROI study and re-calculate the actual benefits you’ve accrued from the new tool.  Compare the current metrics with your baseline metrics that you established in your original project.  You may be surprised to find quantifiable benefits that you never imagined, or you may be surprised at the amount of the benefits that you did anticipate.  Most times, you are so used to the new system by now that the benefits have become hidden to you, and people in your company fail to appreciate them.

This step helps to assure upper management that the purchase was indeed a good one.  If your implementation has been rocky or painful, it is doubly important to take this step to highlight the benefits that may not be apparent to managers outside your support center.  In any case, it makes you look very smart.  Be sure to present your findings to the Decision-maker, your Influential Ally, your finance friend, and any other managers that you need to keep informed.

Conclusion:

This six-step process helps you play both the financial and political games involved in getting the OK from your management to purchase a support tool.  The steps provide a disciplined approach to this often-messy endeavor.  Although there is no guarantee in this or in life, following these guidelines certainly gives you the advantage in getting to YES!